Little Tips to Make Your QuickBooks Easier…

It is the goal of this column to answer questions about QuickBooks and how it is used in the REI arena. Knowing how to record transactions in the proper way and have your set of books in good shape when it comes time for taxes. It is our intention to do this with you, the members, submitting questions to Karen@smallbusinessadvisor.biz, and getting answers here in this column.

Q: I need to segment my balance sheet AND income statement into three departments (classes). Which version of QuickBooks can provide me with this capability?

A: The lowest edition you can use to have classes on both the balance sheet and the income statement is the QuickBooks Premier.

Q: It takes me all day to reconcile my bank account. I thought it was supposed to be easy in QuickBooks. Every rent check I receive shows up as a separate deposit in my check register, but when I go to the bank I deposit several checks at a time in one deposit. Why doesn’t it show up the same in my register as on my bank statement.

A; If you did not turn on the “Undeposited Funds” feature in preferences, then QuickBooks will put each received payment directly to the bank. You want the “Undeposited Funds” feature on so you can “collect” your received payments together as one deposit duplicating what you actually take to the bank.

Q: I received a “Refundable Security Deposit” from my tenant. How do I enter this into QuickBooks?

A: This is a Liability account that you will need to pay out at some later date. In your chart of accounts you should have a Liability account set up for Security Deposits Escrow – or some name that sets it apart from security deposits you paid that are owed back to you (which is an Asset). In the deposit window, instead of showing this as income you should go to this special Liability account and book it to that account. When it is time to pay the tenant the money back, less any damages if need be, you will write the check out and expense it also to this Liability account to clear the money from the account.

Q: I have used my business checking/debit card to make a number of purchases that were for me personally and have nothing to do with my business – how can I fix this?

A: You have two choices: You can reimburse the company for those expenses and put them in an account (equity) called Personal Expense and then when you make the deposit you apply that to the same account. Or you can just leave them in the Equity account and this will become income to you at the end of the year.

Q: How can I compare my business P&L of this year to last years’ P&L?

A: When you run your P&L for the period you want to look at you can go up to the tab on that screen that says Modify – go to bottom of screen and choose box that is Last Period Comparison and you can also choose % if you want. Then you will have a side by side report for the same period last year.

Karen Bershad is The Small Business Advisor. Most small business owners have a challenge handling all the different areas of running a business. The accounting can be a challenge, particularly if the software seems overwhelming. The Small Business Advisor is what you may need to get you to the next level of your business. We work at your office or provide off site assistance in getting things under control by providing a wide variety of services that are specifically for the small business.